Solution to exercise

  1. F (z1, 2) = [2z12 + 2z22]1/2 = (2)1/2(z12 + z22)1/2 = F (z1, z2). Thus this production function has CRTS.
  2. F (z1, z2) = (z1 + z2)1/2 = 1/2(z1 + z2)1/2 = 1/2F (z1, z2). Thus this production function has DRTS.
  3. F (z1, z2) = 1/2z11/2 + z2 < (z11/2 + z2) = F (z1, z2) for > 1. Thus this production function has DRTS.